Retailers Are Abandoning Newspapers This Holiday Season

Retailers are slashing spending on print newspaper advertising, a response not only to declining newspaper circulation but also to shifting behaviors by consumers, who are doing ever more of their holiday shopping online.

Retailers’ spending on newspaper ads so far this holiday season has declined more than 30%, the biggest decline in at least four years, Kantar Media data showed. The measure declined 15% in 2015.

The reduced spend on newspapers is a key driver of an overall 13% drop in retailers’ holiday media spending on TV, newspaper, radio and digital display ads between November 21 and December 11, Kantar said. Excluding newspapers, holiday media ad spending on those measured channels would have declined just 3% to $945 million. (The data doesn't include ad spending on paid search, online video or mobile—all key parts of retailers’ advertising strategies.)

“Newspapers have been a challenged medium with declining circulation and revenue,” said Jon Swallen, Kantar Media’s chief research officer, in an interview, adding that retailers have so far been reducing newspaper ad spending at a slower rate than other advertisers.

Retailers have been one of the top two to three advertiser groups that newspapers rely on for ad revenue, he said. “As newspaper circulation declines, that [local market] coverage becomes smaller. It’s down to the point where retailers now see the return on investment is no longer there.”

Inserts from national chains, a traditional staple for newspapers during the holiday season, are declining at an even faster rate than overall newspaper print ads, Swallen said.

In total, newspapers’ share of retailers’ holiday media spending measured by Kantar in November and December dropped to 14% in 2015 from 17% in 2014 while digital’s share jumped 4 percentage points to 26% in 2015, Swallen said. TV saw its share decline by 2 percentage points to 44% last year.

“Retailers may have reached a tipping point in terms of their use of newspaper and share of ad budget,” Swallen said.

—Andria Cheng

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